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In the U.S., most companies are working at some level on the eventual migration from Generally Accepted Accounting Principles to International Financial Reporting Standards. Information technology leaders are starting to reach the conclusion that with adequate planning, the shift to IFRS can create opportunities to upgrade processing and systems while at the same time cutting costs.

Related Summaries

The European Securities and Markets Authority criticized a recommendation by the International Financial Reporting Standards committee that the International Accounting Standards Board consider the aggregation of operating segments during the post-implementation review. ESMA says that would delay improvements to IFRS 8. It wants these issues to be considered in the annual review of improvements suggested for standards.

Audit expert Wayne Williams describes how audit committees and managers should begin preparing for a switch to International Finance Reporting Standards. Companies should plan ahead to understand how IFRS would affect their statements and allow time for educating stakeholders. Ultimately, the change should make accounting comparisons easier and promote greater transparency through the standards' principles-based approach, he notes. To learn more about current and emerging issues affecting audit committees, attend the AICPA National Audit Committee Forum.

The Securities and Exchange Commission is planning to try to help companies make a more rapid transition to International Financial Reporting Standards. The need for the new accounting system, which would be the sole international standard, is agreed to in principle by most companies, but they are concerned about how to make the transition. The SEC is going to focus on the "road map" for IFRS that it has prepared in order to help companies make the change.

The Financial Accounting Standards Board and the Financial Accounting Foundation say additional study by the Securities and Exchange Commission is needed on possible approaches to a U.S. migration to International Financial Reporting Standards. A comment letter from the organizations said the SEC should allow limited early adoption of IFRS by U.S. public companies only after there is a decision that all U.S. public companies will ultimately be required to adopt IFRS.

For those charged with educating the next generation of accountants, the expected shift from U.S. GAAP to International Financial Reporting Standards stirs up a host of issues. In a round-table discussion, prominent professors discuss how the international standards will affect the curriculum and other aspects of accounting education. Sound clips from the discussion are available here.